As the retail trade faces up to the reality and consequences of retail saturation together with an increasingly demanding customer, so it is being forced to understand and react to that consumer. Gone are the days of pile it high, sell it cheap merchandising. The retailer today is conscious that every square foot of sales space needs to be optimised. Before space is even considered though, the first concern is get the merchandise offering right: meet, even create, the consumer need. This is true, whether the merchandise be food and groceries, electrical goods, baby clothes, or a mix of all three plus fifty or more other categories - as in the variety or department store. This paper discusses how market research can help the retailer to improve and develop his merchandise offer: to meet better the needs of shoppers in the catchment of his stores and according to the type of shopping trip they are on. This does not just concern the goods themselves but also where they are positioned in the store, presented and even promoted to consumers. The paper draws on basic research conducted into consumer shopping behaviour and decision-making in the shop and a number of case histories are used to illustrate the various techniques which can be applied.